Frequent flyer programs are all about loyalty: recognizing it, rewarding it, and encouraging more of it. Elite status is the airlines’ way of ensuring that the airlines’ most profitable customers receive the most recognition, the most rewards, and the most encouragement.
Elite status can only be effective (from the airlines’ standpoint) and attractive (from the members’ standpoint) if airlines are willing and able to dole out meaningful awards to elite members. By far, the most sought-after perks are upgrades from coach to first class.
But, travelers have begun to doubt the carriers’ ability to deliver those upgrades, and these uncertainties have in turn undermined the perceived value of earning elite status. A reality check is therefore in order, and the results may surprise the more cynical flyers.
Elite program changes
Frequent flyers’ doubts about the availability of upgrades have arisen in response to several recent developments in the airline industry:
More elite members
First, the airlines have made elite status more accessible. Never before have there been as many ways to earn elite-qualifying miles.
With the global airline alliances, frequent flyer program members can earn miles that count toward elite status not only with the airline that hosts the program, but with all airlines linked together in the alliance network. Most airlines have also upped the number of elite miles earned for higher-priced tickets. And in a significant departure from the programs’ original philosophy, the airlines are awarding elite miles for non-flight activities, including credit card use and online booking.
While the airlines were unwilling to divulge membership and growth numbers for their elite programs, the assumption is that these changes have resulted in more travelers earning elite status.
More complimentary upgrades
Beginning in 2004, elites at Continental, Delta, Northwest, and US Airways have been offered “unlimited complimentary” upgrades, allowing elite members ticketed on full coach fares to reserve upgrades subject to availability any time before departure. Members traveling on qualifying discount fares may request upgrades according to their elite level.
At American and United, the upgrade policy is less generous. At American, Gold and Platinum members receive complimentary upgrades only from full-fare coach tickets; Executive Platinum members can upgrade from cheaper fares. And at United, all elites must purchase full-fare coach tickets to receive complimentary upgrades. Still, the effect of all these policies is to increase demand for a limited supply of upper-class seats.
Fewer first-class seats
Airlines generally offer complimentary elite upgrades only for flights within the U.S. and to close-by destinations like Mexico and Canada. And these days, there are simply fewer first-class seats on domestic routes. The shrinking upper class is a result of equipment downsizing, as airlines replace larger aircraft with regional jets and turboprops, which often have no first-class cabin.
In February, Delta capped domestic first-class fares at $599 each way, and in late July, raised the cap to $699. Other airlines matched, making first class more affordable than ever. With more travelers able to afford first class tickets, many travelers assume that fewer seats will be available for upgrades.
Word on the street (and in the air)
Based on the situation outlined above, frequent flyers have every reason to believe that the complaints about upgrade availability are the norm, not the exception.
To test that assumption, I asked subscribers to a travel newsletter who have elite status to comment on their personal experiences with upgrades. Here are their stories:
Gary Sagiv, a marketing executive in St. Paul, MN, who flies 900,000 miles per year, is a Platinum member of Northwest’s WorldPerks program. With the exception of two Minneapolis to Boston flights, Sagiv “has never not been upgraded.” He guesses that lower-level WorldPerks elite members are upgraded 95 percent of the time.
Another success story comes from Mark Sebolt from Concord, CA, a seven-year MVP Gold member of Alaska Airlines’ program. Sebolt logs a hundred flights per year, mostly from the Oakland and Sacramento airports. Upgrades? “I have not flown coach in six years,” he says. “Gotta love it.”
Stephen Goldstone flies from Newark and La Guardia and is less enthusiastic about his Platinum status with Continental OnePass. “Upgrades were no problem a few years ago. Now it’s 50-50, maybe less.” With upgrades in shorter supply, he says the value of elite status “has dropped tremendously.” As a result, he booked a recent flight to Bermuda on American.
J.E. is both a Platinum member of Delta’s SkyMiles program and a Delta Million Miler. She estimates that she’s upgraded on 75 to 80 percent of her domestic Delta flights. “And I’m fine with that,” she adds. But she notes that her success rate is higher than many of her coworkers’ because she books as far in advance as possible and is willing to reschedule or pay a higher fare (“as long as it’s not too much higher”) to increase her chances of being upgraded.
Nick Holland took a nontraditional route to Gold status in US Airways’ program: His travel is primarily for leisure rather than business. In particular, he flies from Charlotte to London three or four times per year. He also credits the Dividend Miles credit card, which generates 10,000 elite-qualifying miles to his account after $25,000 in annual charges. Complimentary upgrades? “Pretty much every flight, and certainly well over 75 percent,” he reports.
Kathleen Baxter, a Minneapolis-based librarian who makes 20 to 30 trips per year to speak about children’s books at seminars and conventions, is Gold elite with Northwest’s program. She finds herself upgraded 95 percent of the time. “I feel well-treated by NWA.” Baxter is a believer in what might be called the “Golden Rule” of travel. “Be upbeat, pleasant, and nice. And dress nicely.” That approach has paid off. She’s sweet-talked an onboard upgrade for her husband and, on another occasion, a companion upgrade for a friend.
The results are in
The responses are a mixed bag, but the raves far outweigh the rants. The overall picture is of a small but economically significant segment of the traveling public that feels that its needs—at least as far as upgrades are concerned—are being adequately met.
That finding is at odds with conventional wisdom and raises the question: Where did the doubts about upgrade availability come from?
Clearly, analysts (including this writer) looked at the aforementioned industry developments and concluded that, in the absence of corrective action on the airlines’ part to address the imbalance, the inevitable result would be a growing disconnect between the supply of upgrade seats and the demand for them from elite members.
Based on the admittedly small sample of feedback from the frontlines of travel, we got it wrong. Either we misjudged the effects of a growing elite membership or the airlines made adjustments to compensate for the increase in demand.
In any case, the verdict is in and the airlines have been absolved of over-promising upgrades. If you were wondering whether elite status is worth pursuing, as I was, you can upgrade your expectations.
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